HIGH COURT CONVICTS TAXPAYER FOR EVASION OF OVER K24 MILLION IN TAXES
The High Court of Zambia has overturned a decision by the Kitwe Subordinate Court for acquitting a taxpayer for the offense of tax evasion amounting to over K24 million.
In its desire to crack down on tax payers involved in Value Added Tax (VAT) fraud, the Zambia Revenue Authority (ZRA) appealed against the acquittal of Liko’s Industries and Logistics Company Limited on 32 counts of false returns and statements contrary to section 43, and evasion of taxation contrary to section 44 of the Value Added Tax Act Chapter 331 of the Laws of Zambia by the Kitwe Subordinate Court.
The High Court for Zambia (Economic and Financial Crimes Division) agreed with the State that the evidence on record presented by the Prosecution demonstrated that the accused furnished various Tax Invoices to Zambia Revenue Authority purporting to show that they had supplied taxable goods to 34 Copperbelt companies when in fact not and the sole purpose was to evade the payment of K24,069,730.07 to the Government of the Republic of Zambia.
In overturning the decision of the Subordinate Court in Kitwe, the High Court observed that the trial court erred in law when it acquitted Kennedy Likomeno (Director) and Liko’s Investments and Logistics Company Limited on the basis that the Prosecution did not prove that the accused persons knowingly and wilfully filed False Returns and Statements which were false in material particular when section 43 of the Value Added Tax Act CAP 331 of the Laws of Zambia does not require the Prosecution to prove knowingly and wilfully as elements or ingredients of the offence under the said section 43.
The Court further said;
“…and we are cognizant of the fact that the Second Respondent (Liko’s Industries & Logistics Company Limited) had two Shareholders/Directors both sharing the name of Kennedy Likomeno Notwithstanding that the fictitious legal mind of a company is operative through its human elements, we agree with the findings of the trial Court that there was no conclusive evidence to personally attach criminal liability to the First Respondent (Director), either severally or jointly with the Second Respondent as envisaged by Section 46A of the Act in relation to the Counts herein”.
In deciding of the grounds of the appeal by the Prosecution”, the court held as follows;
“..In the light of the foregoing, the Appeal in Ground Two fails. However, the Appeal in Ground One as against the Second Respondent succeeds. Accordingly, the trial Court’s decision to acquit the Second Respondent, Liko’s Industries & Logistics Company Limited in Counts 9 to 40 is hereby quashed. And we do hereby find the Second Respondent guilty as charged in Counts 9 to 40, and convict the said Second Respondent accordingly”.
The Court further mentioned that the decision to acquit the accused was perverse and against the weight of evidence, which is beyond reasonable doubt. Therefore, Liko’s Industries and Logistics Company Limited was found guilty as charged and convicted accordingly.
The judgement consequently orders the convicted taxpayer to pay the evaded sum of taxes.
The Zambia Revenue Authority would like to remind taxpayers and the general public to always make truthful and correct business transactions with the Authority to avoid being in conflict with laws that govern taxation.
©Zambia Revenue Authority (ZRA)